With so much brick-and-mortar retail shut-down, retail has to happen somewhere, so it's going to happen online. Increases in product sales online could result in net declines for the product group when you factor in the loss of B&M sales.
I think the logical result here is pretty well-represented in how some public companies in this space's stocks prices are playing out. Distribution companies are likely to prosper because their competition has decreased substantially:
* Amazon is at an all-time high * Overstock has recovered their dip * Wayfair is recovering their dip * Chewy is at an all-time high
None of this means the manufacturers who these distributors are selling are doing well, though.
On the flip side, the product categories that are down substantially online are likely facing devastating loses. They already aren't selling in retail so if ecomm is it and they're down there, it's really bad.
Outside of distributors, I think the D2C ecomm space is a huge mixed bag but likely net negative for a few reasons:
1. A lot of DTC companies play in the product categories that are seeing lower online sales
2. Most DTC companies are positioned as being accessible, but still premium. There are cheaper alternatives people may be more inclined to go with, given the economic uncertainty.
Given that, layoffs at Away, Everlane, Third Love, Stitch Fix, Casper, etc. make sense, even if online sales as a whole are up. Some of them may even need to start paying attention to unit economics now! I'd guess a lot are scaling back advertising and trying to focus on lower-cost acquisition channels to keep a tighter grip on cash flow.
Because a lot of the online services that are seeing higher use (whether it's telework support, e-commerce, or otherwise) are, in whole or in part, hosted on AWS.
Yes, through accounting magic, they're making the majority of their profits via AWS, but that's part of Bezos's long-term strategy and could be changed on a dime (at the potential expense of the long-term growth he's targeting).
Top line, most of their business is from online retail, not AWS.
(edited because my original was a bit of a flame, and didn't clarify profit vs revenue distinction)
With so many people inside everyone is using online services: streaming, shopping, chatting, video, audio, gaming.
Almost anything "online" is very likely to run at least something on AWS these days.
Again, I am seriously not being judgmental, I am curious.
I've been doing Facebook ads for 9 years. My team and I are a white label agency so we do the media buying for creative shops, designers, content marketers, etc. So I didn't land any client. I partnered with the folks that did. I got the partnership by putting out a ton of content on Youtube (Over 20 hours worth), through doing a 30 episode deep podcast on running an advertising agency, and being super helpful in a number of Facebook groups, Linkedin groups, etc. for years.
Tl;DR Content Marketing + Networking
We have some customers that saw there orders come to a stop, even a few bankruptcies already. But almost all see a 30-40% bigger order flow. Some customers that sell DIY hair products see a doubling or tripling in orders per day and revenue.
When I talk to the biggest e-commerce players in the Netherlands and the top 3 parcel shippers, they all see (near) black friday levels of orders/shipments.
In France there is no increase of unemployment, instead they are at home getting paid, I guess they have a lot of money to spend as they can't party or go the restaurant
It is actually quite visible here : https://contentsquare.com/covid-19-ecommerce-impact-data-hub...
[0] https://www.investopedia.com/terms/l/lipstick-effect.asp
Because French law makes it so hard to fire a full-time employee, many businesses only hire workers on a part-time basis.
In contrast, most US unemployment numbers generally include all individuals seeking work, regardless of the type of employment they previously had.
The big question though is how long will this last? I think the general population has not yet appreciated the possible severity of the ensuing economic downturn.
A lot of trade publications are already starting to sound the alarms on how ugly this could get. A return to 2008 era aggressive discounting is likely going to happen. Retail partners may be crippled by the quarantine. A lot of brands are going to be assailed from many directions simultaneously, it's going to hurt.
My fear as well. The swiftness and ferocity of this downturn is like nothing ever, AFAIK. 22 million out of work in 4 weeks. Many are unlikely to get their jobs back. So while certain companies are seeing upticks due to logistics of the lockdown, I don't think it's safe to assume it would continue long after SIP ends.
Their original job? Sounds plausible. Any job? Surely that would be a political choice for their respective governments? Unless there’s a reason we can’t repeat the famous infrastructure jobs programs from a century ago - I’m no economist, so I genuinely don’t know, but Hoover Dam Mark 2 sounds good to me.
I think the general public has not yet appreciated the current severity of the present economic downturn, much less the future possibility.
[0]https://www.digitalcommerce360.com/2018/03/29/shopify-picks-...
I've been hearing over the past 2 weeks that online traffic and revenue has been soaring for others, but I'm skeptical. I think it's just traditional brick & mortar shops that never had the time nor the impetus to set up an online presence now doing so. Just my 2c.
Many small Shopify retailers have pivoted quickly and are stocking some items that Amazon is having trouble keeping in stock.
We run an omni-channel API connector service for our wholesale distributors to connect Shopify/marketplaces to our own back-end on-premise ERP, and the distributors that have utilized this service are seeing record breaking numbers that are in-line with what Shopify is saying.
The downside? We launched this service less than a year ago and could’ve showcased some staggering numbers if we launched earlier. We’re trying to show the limited data we have to our customers to convince them to pivot to e-commerce while their wholesale channels are suffering.
This is a fundamental repricing, going forwards ecommerce will become the norm as the slow adopters move onto it quicker. SHOP could be worth way more under a post pandemic economy. This isnt the same economy as three months ago, certain companies are worth more and certain ones are worth less. The money to be made in options is in understanding these repricings and exploiting them, a stock at ATH right now is a stock that may actually grow more in the future, its post pandemic outlook is only in the process of being priced in......
Shopify material makes it sound like you can easily sell it for 4x the cost if you spend enough on marketing, etc. Has anyone here have experience setting up dropshipping on shopify recently and making a decent profit?
Shopify has not be helpful as an organization, and their processes and red tape have been a challenge. But, it's apparently working for them.
Rails is still great ( or possibly best ) for SaaS or Paid per usage model. Not so good for ad based or traffic driven per revenue model.
The whole industry is experiencing a surge in online-window-shopping. Amazon is probably seeing a few blackfridays increase.
Online sales are absolutely up.
Most people aren't at the point where they feel they need to drastically cut their spending. Most developed countries have some sort of payment going out to at least the unemployed. Also, even the newly unemployed have only been in that position for a few weeks.
The people who are still employed, whether that's remote or whatever, have a surplus of money they normally would spend on things like travel, events, and dining out. They are absolutely not worried about spending money on discretionaries.
The reality is, people still have a ton of money to spend. And less places to spend it. This recession is just barely getting started.
If anyone is looking for a good way to support an arts non-profit with their stimulus check, checkout Aperture, they are having a huge sale on books. I'm not affiliated; I just like photo books.
I wonder if this will remain true after Covid lock-in ends. It felt like the pendulum had swung awfully far towards people valuing experiences over items.
Also, howdy 11201 neighbor.
Anecdotally, I'm getting UPS packages delivered at any time between 8am - 10pm. The night driver has to use a headlamp to read building numbers.
It's pretty impressive that a small business like that can have a functional site up in a few days.
https://www.visualcapitalist.com/shoppers-buying-online-ecom...
Food, workout items, entertainment. A lot of categories are through the roof!
I wonder if gyms will ever come back from this. Gold's announced yesterday they are permanently closing 30+ locations. Even when people go back out, gyms were never the cleanest places to start with. Some places will require masks for the near future, so how does that work at a gym? Now that I'm been forced to finish my home gym, I'll likely cancel my membership once things open again.
Americans don't know how to budget and will buy stuff just because they feel like it.
Edit: I did buy a pricey swing set for my 2 toddlers. But I wanted to buy one last year was denied. This lockdown convinced my wife otherwise.
I think its $70 per month accounting for PPP, but even then the difference is massive
